Make available test failed for software platform access receipts, so fees for included services tax treatment was rejected.

Receipts from customer access to a software-based analytics platform were not taxable as fees for technical services or fees for included services under the Income-tax Act and the India-USA DTAA because the "make available" test was not met. The platform only generated reports and analytical outputs; it did not transmit technical knowledge, skill, know-how, source code, or any technical plan or process enabling customers to apply the technology independently in future. Mere use of a technology-enabled product, or the fact that technical effort was involved in producing the output, was insufficient. The addition was therefore deleted.

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Issues: Whether the receipts from access to the software platform were taxable in India as fees for technical services / fees for included services under the Income-tax Act, 1961 and the India-USA DTAA, and whether the "make available" condition was satisfied.

Analysis: The receipts arose from customers accessing the assessee's software platform to generate reports and analytical outputs. The decisive question under Article 12(4)(b) was whether any technical knowledge, experience, skill, know-how, or process was made available to the customers so that they could apply it independently in future. The outputs generated from the platform were only commercial or business information and did not transmit technical knowledge or a technical plan/design. The customers were not given source code or any technology enabling them to replicate the process on their own, and the service contract only permitted access during the subscription period. The mere use of a technology-enabled product, or the fact that technical effort was involved in generating the output, did not satisfy the treaty test.

Conclusion: The receipts did not constitute fees for technical services or fees for included services, and the addition was not sustainable. The appeal was allowed in favour of the assessee.

Ratio Decidendi: Payments for access to a software-based analytics platform are not taxable as fees for included services unless the service provider makes available technical knowledge, skill, know-how, or processes that enable the recipient to apply the technology independently in future.

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